Research On Financial Risk Control Of Enterprise Merger And Acquisition

M&A is the development strategy that enterprises choose to deal with market competition.Whether they use horizontal integration strategy,vertical integration strategy or diversification strategy,their fundamental purpose is to maximize their long-term profits.With the gradual maturity of China’s M&A market,the number of domestic strategic M&A transactions has achieved a strong growth,but the failure rate of M&A has always been high.The failed M&A may have different degrees of impact on the interests of one or even both sides of the M&A.This paper focuses on the reasons for the failure of M&A,analyzes the financial risks in the process of M&A from the perspective of financial risk management,and puts forward the improvement of financial risk control.This paper takes the failure case of NE Enery’s merger and acquisition of SG Lithium Industry as the specific research object,and analyzes how to analyze and control the financial risk in the process of enterprise merger and acquisition.The research work adopts the methods of literature research,case analysis and financial analysis.From theoretical summary to case application,it focuses on the financial risks in the process of enterprise merger and acquisition and explores the corresponding solutions.Based on the failure case of NE Enery in the acquisition of SG Lithium Industry,this paper hopes to learn from the facts and enrich the theory and practice system of M&A risk management in China.The first part of the paper is the introduction,which introduces the research background and significance of this paper,literature review and comments on M&A,research content and methods.The second part is the theoretical basis.It reviews and summarizes the previous research results,and analyzes the financial risks in the process of M&A,which lays a theoretical foundation for this study.The third part focuses on the analysis of the company background of both sides of the merger and acquisition,and introduces the motivation,process and result of the merger and acquisition.The fourth part,from the perspective of financial risk management,analyzes the problems existing in the financial risk management of NE Enery in the pre merger,implementation and integration stages.The fifth part is the financial risk improvement measures of the M&A case,and the final part is the case summaryThis paper holds that before M&A,the enterprise should fully consider the future market changes of the main product price of the acquired party,and carefully evaluate the development expectation of the acquired party;secondly,due diligence plays an important role in M&A,and whether the due diligence of key information is sufficient or not is crucial to the result of M&A,and the due diligence of related enterprises should also be included;finally,M&A evaluation should be carried out Value should fully consider the industry factors,reasonably use the assumed conditions of merger and acquisition,and bring various key risk factors into the valuation system,and realize reasonable valuation by comparing various evaluation methods and combining with the situation of due diligence.